The Islamic State (IS) group has ousted a US-backed coalition of Kurdish and Arab forces from its holdout in eastern Syria, killing dozens of fighters, an activist group said on Sunday.

A Syrian Democratic Forces (SDF) commander, asking not to be named, also confirmed to the AFP news agency that the SDF was retreating from the Hajin pocket near the Iraqi border, seven weeks into an offensive.

The SDF, which is backed by air strikes from the US-led coalition, launched its campaign to retake the IS holdout on 10 September.

But it has faced fierce fighting from IS, including under the cover of sandstorms, the UK-based Syrian Observatory for Human Rights said.

"In counterattacks since Friday to Sunday dawn, IS has taken back all positions to which the SDF had advanced inside the Hajin pocket," Observatory chief Rami Abdurrahman, said.

The Observatory reported that 72 SDF fighters had been killed, as IS took advantage of a storm that hampered coalition air cover and dispatched suicide bombers as part of their fightback.

However, a spokesman for the SDF told the Reuters news agency that the number of casualties was far lower.

"Daesh terrorists continue to launch counter attacks, taking advantage of the bad weather conditions. ... Due to fierce clashes 14 of our fighters were martyred," SDF spokesman Kino Gibrail said on Saturday, using an Arabic acronym for the Islamic State.

'Our forces don't know the area'

Meanwhile, the unnamed SDF commander told AFP that the setbacks were due to his forces' lack of local knowledge of the terrain, a factor worsened by the sandstorms.

Unlike IS, "our forces don't know the area and can't move around in conditions of zero visibility," he said.

"Military reinforcements and heavy weapons have been sent to the front, and some units will be replaced by more experienced ones," the commander said.

"We will launch a new military campaign as soon as those reinforcements have arrived," he said.

More than 300 SDF fighters and around 500 IS fighters have been killed in the past seven weeks of fighting, the Observatory says.

The coalition estimates that 2,000 IS fighters remain in the Hajin area, while around 2,000 US special forces troops are believed to be on the ground in Syria, where they have aided the SDF.

The SDF now controls significant territory in the north and east of Syria, the largest part of the country outside government control, while largely avoiding direct confrontation with Damascus in the multi-sided war.

IS overran large areas of Syria and neighbouring Iraq in 2014, proclaiming a "caliphate" across land it controlled.

The group has since lost most of that territory to various offensives in both countries.

In Syria, its presence has been reduced to parts of the vast Badia desert, also in the east, and Hajin.

A total of more than 360,000 people have been killed since Syria's war erupted in 2011 with the brutal repression of anti-government protests.